Ionis Pharmaceuticals, Inc. (IONS) Earnings Call Transcript & Summary

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All right. Good morning, and thank you for joining us on Guggenheim's Genomic Medicine and Rare Disease conference, day 2. This is the fifth iteration. I am Debjit and I'm one of the covering analysts at Guggenheim. My privilege to welcome Ionis Pharmaceuticals Executive Vice President of Research, Eric Swayze. Good morning, Eric. Thank you for your time today.

Good morning, and thanks for having me on your show. Appreciate being here.

Well not much of a show, but let's get on with the Q&A then. I mean, obviously, given the depth and breadth of the pipeline and the recent positive -- [ go over ] the FDA for late this year for the some panel votes, any key programs you would like -- or the company would like to highlight for this year and next?

Yes. I mean we should probably talk about eplontersen a little bit. We just announced some top line positive data from week 66 from our polyneuropathy study that goes on top of the positive data we announced last year for week 35, which supports an FDA filing, and we have a PDUFA date from the FDA for late this year for the approval of that -- hopefully approval of that compound in polyneuropathy. The week 66 data will support filing ex U.S. and so -- along with our partner, AstraZeneca, in that program. We're pretty excited about the data and happy to have multiple filings supported worldwide for what we think is a great-looking drug and then we're going to have some data presented at AAN later this month that will show the full scope of the drug and how it performs in addition to what we presented from week 35 last year. So it's a great-looking compound. And as I'm sure you're aware, we also have an ongoing trial for that drug in cardiomyopathy space, which is a larger indication, and looking at cardiovascular outcomes. And there, we have the largest and most extensive cardiovascular outcomes trial in the industry and what's shaping up to be a reasonably competitive marketplace for eplontersen. And we look forward to having some data in 2025 in that program, where we're looking at cardiovascular endpoints both on top of the standard of care tafamidis and [ also alone ]. So I think it's a very important program for us and the drug continues to perform really well. And you mentioned tofersen, we had a nice AdCom and where the -- we were pleased to see the panel members unanimously support the accelerated approval thinking in path that the FDA discussed, and we are looking forward to our PDUFA date at the end of this month also. So an exciting time for a couple of our rare disease programs at Ionis. And I suppose there's one more that we should highlight we're going to have some Phase III data this year is olezarsen, where we have a triglyceride-lowering drug that targets APOC3. We'll have data later this year for a rare disease indication, FCS. And that's the first of a couple of indications for olezarsen. The next one would be a much larger indication, exiting the rare disease space with several million patients in the United States, and this is for severe hypertriglyceridemia, where you need to lower triglycerides in patients who have trigs over 500 mg per deciliter and who are at risk of things like pancreatitis. So that's a much larger indication, and this is one that we're planning on commercializing our own. And I suppose the last one is donidalorsen for hereditary angioedema, also in Phase III, also a rare disease. Another drug where we think we have a great-looking compound, we think it has the potential to be best-in-class for treating hereditary angioedema. And we'll turn over that Phase III card in early next year on top of some really nice Phase II data and from some open-label data for that compound. We can discuss any of those programs in more detail.

Awesome. And let's start with something which is not commonly discussed here, your partnership with Bicycle and more recent partnership with Metagenomi. You've put in significant efforts on the MSPA backbone. Sort of give us a feel for where you're taking the program with the MSPA backbone on the neuromuscular side, if not on the neuromuscular side, the rare cardiac -- the genetic cardiac indication that we've talked about before.

Okay. Well, I love to talk about technology. So this will be fun. So the MSPA backbone has been something that we think could be really transformative. And it's been a long time in coming. And the reason we think it's so intriguing is it -- for the really -- for the first time, gives us the ability to tune the content of the phosphorothioate backbone in our molecules. And for those who aren't antisense technology nerds like me, the phosphorothioate is kind of the -- it's a love-hate affair with people who develop oligonucleotide drugs. It allows -- it stabilizes the molecule and allows them to have good distribution in animal systems, but at the end of the day, it also causes some nonspecific protein interactions. And the benefits of the stability are kind of -- they can be counteracted by some of the liabilities of the nonspecific protein binding. And it's been very tough to disentangle those 2 effects. MSPA allows us to do that. It stabilizes the molecule and allows us to really tune the protein [ bind ] to be exactly what we want, optimal for distribution. But we can then engineer out, for example, some pro-inflammatory effects. And so that long-winded answer is really to highlight what we think is broad versatility of the backbone. And truthfully, it's in every molecule selection exercise that's ongoing within Ionis. So we think it's going to be used very broadly. We've transitioned 2 neurology programs to development that incorporate that backbone. One is a wholly owned Ionis program and the other one is a partnered program. But we think it's going to end up being quite broadly used across the platform because of the properties that [ I spoused ] and its ability to extend duration of action with the compound by stabilizing what is the weak point of the molecule, which is the DNA phosphorothioates linkage. So that's MSPA. It's still early in the backbone. We don't have any human experience yet, but we're moving it forward aggressively into preclinical development and are optimistic we'll be able to get some molecules move forward, hopefully, next year. Then you asked about Bicycle. I think Bicycle is a great example of what we call LICA or ligand conjugated antisense is the acronym. And basically, it's putting something on a molecule that directs the molecule to where we want to take it. The first example of LICA is becoming pretty commonplace. It's GalNAc or triantennary N-acetyl-galactosamine clusters. These direct the molecules to the hepatocytes, and it's been reasonably broadly used in the industry. And we have 15 or 16 programs that use that, and it's the subject of many late-stage programs, including olezarsen, donidalorsen and eplontersen, in which I highlighted earlier, that technology is used. So the key question for us was well, instead of one offer or can we do more? And are there more LICAs out there waiting to be had? One of them is ligands which engage transferrin receptor 1, which have been shown to distribute drugs to muscle tissue, both skeletal muscle and also cardiac muscle. And so we were very interested in this space for obvious reasons. And we're looking for a solution that wasn't just an antibody that was potentially -- looking like our GalNAc drug, something that was a lower molecular rate molecule that wouldn't dramatically change the properties of our drugs, that would allow us to have subq administration, for example, that we thought would be straightforward to manufacture and control, kind of look like GalNAc. And we think the Bicycle solution is a great potential solution. Their bicyclic peptides generated by technology from this U.K. company came, Bicycle Therapeutics. And what they are is kind of too little looped peptides, bicyclic peptides that can mimic the structure of an antibody in a small framework. And this -- and Bicycle has been very successful in developing affinity binders for a variety of targets. They've done that for transferrin receptor, and we've got an exclusive license from them for using transferrin receptor 1 bicycles for oligonucleotide cargoes. And that includes both antisense oligonucleotides traditionally as well as [ siRNAs ] where we found really fantastic looking data using preclinical data looking -- with Bicycle's conjugated siRNAs. And so we've been aggressively optimizing the scaffold, the linkage to the oligo, which oligos to use or which indications and are pretty excited about moving our first program using a Bicycle into preclinical development in the next couple of months, hopefully here for cardiomyocyte driven target. So for the first time, we think we can really target the heart tissue and it opens up lots of opportunities for us, if successful, in the cardiovascular space, where we think there's a lot of unmet medical need. And we have a lot of good hypotheses that we'd like to test in clinical trials in patients.

That was great. So Ionis recently published the baliforsen data. Obviously, that was not a targeted approach like going after the transferrin. But you just mentioned transferrin as it relates to your Bicycle collaboration. So beyond the cardiomyocytes, is DM1 still something that you would like to pursue?

Yes. We've thought a lot about DM1. Baliforsen, it was kind of a disappointing story. We thought with some of the newer generation chemistries, we had a shot at targeting skeletal muscle. And the work detailed in that paper says that we were close but really didn't have enough potency in humans to drive the endpoints we wanted. And there's now competitors in the space that are ahead of us and with some skeletal muscle targeting for DM1. We still think that we have a good position in the space and have thought a lot about what to do in the DM1 space. And we've been -- we've been working on it kind of quietly in the background. I think late last year, we have announced that we advanced the partner program into preclinical development, incorporating some LICA technology. This was not a Bicycle and I've been talking about what we're doing with Bicycle. So DM1 has been on our list of things that we're looking at and as our other neuromuscular targets as well as other cardiovascular targets. Given it's a competitive space, we really haven't commented too much about exactly where we're going in the DM1 space. But obviously, we've been there in the past.

Got it. You mentioned donidalorsen in the beginning. That Phase III should read out early next year. From the company's perspective, do you think the HAE market is sticky or if you have a repeat of your Phase II and the open-label study, this is a market that's going to appreciate what a 98% attack-free rate drug really looks like?

Well, I'm certainly hopeful that it's the latter, and we believe that it's the latter because that's why we've -- spending our own -- spending our dollars voting with our own money and running our Phase III trial in this space. We realized the space is competitive. And this is one we were in before with a non-LICA molecule. And when we had the LICA technology, we felt we should give the molecule a chance to succeed with the best drug we can make and asked the question in a Phase II experiment. And we're very gratified to see that it looks like it has the potential to be best-in-class, great attack rate reductions, as you highlighted and really rapid reduction in the frequency of attacks. And we certainly believe that in this market, the patients really care about attack rate loss, right? They don't want to have attacks. They're terrifying. We think that the maximal efficacy is the name of the game in this indication and that if you can achieve that efficacy, there is an attractive market to be had for a company like Ionis in this space, even though it's competitive. We do think that the molecule has to have the profile that it had in Phase II and really -- so that it can be best-in-class to make patients want to switch. And we do think it's a switch type market. We're running a study that is testing that in phase -- in our later stage program, which is if patients switch from whatever they're on to donidalorsen, how do they do? So we'll have data to support that in addition to our Phase III data. We think we've got an awfully good molecule and that it's a good program for Ionis to have and commercialize ourselves.

Yes, I know you like to talk about the technology, but this might be Ionis' first big commercial drug that you're launching yourself. What are you doing behind the scenes to go after the entrenched players because this is a pretty well-established marketplace.

Yes. Well, I mentioned our switch study. And I guess I would say, definitely not a commercial way, but I think that in the end of the day, I tend to believe that the best drugs can win in the marketplace. I take a generic statin, it wasn't the first one in the marketplace, but it turns out to have some of the best LDL reductions of the statins, right? And so you end up getting to the place where I think that a really good drug finds a place for itself with patients. And I would also say that in the marketplace, I looked at the oral compound where the data has done pretty well. And its efficacy, we think, is not the same as some of the other compounds, including lanadelumab, which has been the standard of care really in the industry. But it shows that patients are willing to switch to give -- to try the therapies and see what works best for them. And so we're optimistic that our drug, which has a very nice, clean side-effect profile, which has great efficacy is going to be in a convenient autoinjector that patients can use at home. We think that it has a profile that hopefully patients will want to switch to and we're running the experiments to ask that question.

Got it. And we briefly touched upon the eplontersen 66-week data that was sort of top line a few weeks ago. Now that you guys have insights into the data set, are you completely comfortable that the profile sort of can go head-to-head against Amvuttra?

Yes. Well, I can't really get ahead of the data presentation that's coming at the end of the month. And I can't go much farther than what was in our press release. But I would note that, again, we're voting with our actions and so is AstraZeneca, right? So we feel great about the drug based on the 35-week data we filed with the U.S. FDA and are moving towards commercialization in the U.S. And we're going to file worldwide with the 66-week data, along with AZ. And there was a nice quote from senior AZ people in the press release that we're highlighting the value of the program and what we jointly think of the qualities of the molecules. So I would counsel people to look at our actions and then pay attention for the data coming out in a little bit.

Got it. Earlier this morning, we actually hosted 2 experts on ATTR and while they have obviously great things to say about the trial design for the CARDIO-TTRansform study, the only sort of concern was if the Helios B were to hit AZ -- I'm sorry, Alnylam would have more than a year head start from a commercial opportunity perspective. And that's where once every month versus once every 3-month dosing could come into play. Is there -- between you and AZ, are you actively thinking of maybe an interim analysis to sort of cut that edge?

Yes. So these are all good questions. Our trial, as I'm sure you're aware, was expanded and enlarged to be the largest one in the marketplace because we were paying attention to the external dynamics in the market -- patients getting diagnosed earlier, treated better, not being as sick and enrolling in trials. And that's been published in some nice studies recently. And we saw it in our own trial where we can monitor things like event rates and demographics of patients. And for those reasons, we expanded both the size and the length of the trial, trying to make sure that we have the best chance to get what we want at the endpoint, which is meaningful, statistically significant cardiovascular risk reduction, which is what we think we need to sell the drug into what we know is going to be a competitive market. We want to be able to demonstrate cardiovascular risk reduction for the drug. So the scenario -- certainly, we've thought about it, the hypothetical where a competitor has data that hits and we can look at our event rate, right? So there's not an interim built into our study, but we can look at what's happening in our trial and make decisions whether or not to look for an early readout. So we have some flexibility and can adjust to the dynamics of the environment just like we adjusted before in our trial. And then just to say, it is a big market. We think that there's a lot of -- we and others, but many people think the same thing that there's a lot of undiagnosed cardiovascular patients with TTR cardiomyopathy. We think that AZ is a great partner in this space. They have a lot of cardiovascular muscle and know how to sell drugs into competitive marketplaces. And so we think we have a great drug that can compete in the marketplace even if it's a little bit behind. We like our at-home administration. We like our monthly therapy truthfully because it gets the target down and keeps it suppressed. And the at-home device gives patients the control of their disease so we think it's a competitive product and look forward to demonstrating that.

From a knockdown perspective, there really isn't any significant difference between Amvuttra and eplontersen. But if you think about what happened in the APOLLO-B study, there was no benefit of patisiran on top of tafamidis. Was that primarily on hindsight because of a short trial? Or is that -- sort of the thought process evolved within Ionis, for example?

Well, I think -- so I might quibble a little bit. I think eplontersen and Amvuttra have very similar target reduction. I think patisiran was a little bit less. You can correct me if I misremember that. But I'm not -- I don't know if that matters. I think we're doing a lot of these experiments right now and trying to ask questions about what level of TTR suppression is meaningful in a cardiovascular risk-reduction population and what you need to show that and really get reversion of the deposits. Those questions are just getting answered in humans, and APOLLO-B was one of the first readouts. It was shorter and with fewer patients. So I think that we'll see from their upcoming AdCom what the discussion is and whether the 6-minute walk improvement that they saw is judged meaningful to patients' lives. I can't really speculate on why it didn't hit its end. What I wanted to say, what was a small trial with a shorter timeframe, we upsized ours to try and hit the cardiovascular end.

Switching to the HORIZON LP little A study because that's the other program that keeps coming up in everybody's discussion. One, there are key differences between the Horizon LP little A and the OCEAN study from Amgen. Do you think you've got the right kind of patient mix on the HORIZON study, given that that was the first one that enrolled? And from an effect size perspective, what would be that threshold -- 15%, 20% -- where you think it just becomes a standard of care.

Yes. Well, definitely not a rare disease, this one -- this is a potentially massive indication in massive population, something like more than 15% of the world's population has ILPA, and it's strongly associated with cardiovascular risk and so as many people know. And we're happy to be trailblazing in this space. We're happy to have Novartis as a partner trailblazing with us. I think the HORIZON study is a great experiment, something like 8,000 patients fully enrolled. And one of the key differences -- you highlighted a competitor study -- ours has -- patients have to have previous events and the ILPA cutoffs aren't that much different. We have stratified ours, I think, in between their cutoff or around both edges of their cut off. We'll see what intervention does. And the HORIZON study really is the 1 that's going to demonstrate whether or not lowering LPA in a patient population that's had cardiovascular events can improve their risk for subsequent events. If it's successful, we think it will be a fantastic and large market opportunity and happy to have Novartis as a partner. We're happy with our trial. I think it was a good trial. Novartis has done ton of work getting patients and tracking them and getting them enrolled into our study. No wonder we're really fast. And we think it's a great experiment. I think you asked about standards of risk reduction. Our cardiologists tell us that 20% risk reduction is the metric that 1 usually uses. But that being said, there's no significant -- there's no therapy for ILPA-driven cardiovascular events and risk reduction. So if you can demonstrate that you can really reduce risk, lower thresholds might be seen as significant and meaningful to patients. We'll have to see as the trial plays out.

And would you and partner Novartis wait for the readout before committing to moving it frontline as a preventative medication or you just have to let the data play out before you can think about powering that study?

Yes. I guess I won't comment too much on that. That would be a good question for our clinical development and Novartis' commercial team. We've thought about it, obviously, in terms of prevention. But we really need to -- I think we need to complete this experiment first, right and really understand how -- we need to understand if the hypothesis works and whether or not lowering LPA levels works to reduce cardiovascular risk.

Got it. The GSK-partnered Phase III study that's ongoing right now in chronic Hep-B. That was an interesting choice from a molecule perspective, right? This is not your LICA conjugated ASO. And was the TLR9 activation the primary reason that you guys chose to go with bepirovirsen?

Yes. So actually, we let the data decide there. So GSK moved forward a LICA molecule, as you mentioned, and the bepirovirsen and basically the LICA version of the bepirovirsen. It was just GalNAc stuck on bepi. And in the early-stage trials, bepi outperformed it. And I would direct you to some of GSK's really nice work presented at AALSD or EASL last year -- I can't remember exactly which meeting -- where they looked at TLR8 activation -- actually, it wasn't TLR9 -- TLR8 activation in some mouse models and linked some of that data to responses in the clinical trial. And their hypothesis is that you're getting kind of a dual mechanism that it's doing what it's supposed to, which is lower the S-antigen from HPV and lower HPV DNA and inhibit all HPV RNAs and tickling the immune system a bit. And I think it's probably tickling the immune system in a cell population that's not a hepatocyte that's in the liver, maybe [ for ] cells or something like that, where the drug without the conjugate can get into those cell populations and help the immune system do what it's trying to do and what the S-antigen expression prevented from doing, which is overcoming the deco effect of the S-antigen and then helping the -- really clearing the viral infection. And so that's what the B-Clear study showed is an unprecedented rate really of clearance of both virus and sustained responses. And the goal of the 2 B-Well studies that GSK is running is, on top of nucleoside standard of care, to see if bepirovirsen can cause functional cures in HPV. It's really -- we were very pleasantly surprised to see that it did and are super enthusiastic with GSK's view of the program and love having GSK as a very aggressive partner in the HPV space.

And then let's wrap it up with Angelman. This is a disease state that we get a lot of questions on, given that Ionis is now playing or has been playing for a while. How is that program going? And when the data does -- or when you do make the data public, will that also have target engagement data along with efficacy?

Yes. We haven't talked a lot about our ongoing data. Very, very [indiscernible] -- it like our molecule, we worked really hard to get what we think is a molecule that is typical of the drugs that we have -- the newer molecules that we have developed for neurology, and I'd highlight the MAPT program. There was another piece of data that we had recently that was some more good news that was presented at ADPD by our partner, Biogen, who's licensed the molecule where we saw very nice target engagement upon quarterly dosing of the drug and also importantly, saw very clear evidence of reversal of pathology by tau PET, which was particularly gratifying to some of us who have been working on that program for years. And so we think that type of profile is what we're going to have in all of our molecules, including our Angelman drug. We're pleased with the trial. We're just not going to talk about ongoing data. It's an open-label experiment, and we don't think it's appropriate to talk about data in an ongoing trial. And we'll not likely have much to say about it in 2023. But that being said, we like the drug and are very happy with its profile.

Sorry. I appreciate your time today, Eric. Thank you so much and good luck with the FCS data that's coming up shortly and before that, obviously, the eplontersen presentation.

Great. Thank you.

Thank you so much.